If we talk about finance, numbers are often seen as the ultimate decision-makers. However, there’s an unseen factor that plays a crucial role in shaping your financial decisions – your core values. These guiding principles in your life can significantly influence your financial goals and strategies. So, if you’re wondering whether your financial plan aligns with your values, you’ve landed in the correct place.
What’s the Role of Core Values in Financial Planning?
When it comes to financial decisions, the logical answer isn’t always the right one. The problem is that too many people think financial decisions are just about the numbers. They fail to consider their core values when deciding what route to take, which can result in a few problems.
Without considering your core values when making financial decisions, you probably won’t end up where you want to be. Core personal values serve as guiding principles in a person’s life and can be applied across contexts, one of which can be our financial decisions.
Identifying Them
When trying to name your values, you might point to your financial goals. But those aren’t your core values. Research by Shalom Schwartz features a list of basic values that people often prioritize, such as achievement, security, benevolence, and self-direction. But that doesn’t mean you have to be constrained to these items—with a quick Google search, you’ll find multiple lists floating around (but try sticking to credible sources).
In the context of financial planning, your financial goals are a means to an end, and that end is your core values. In a way, your core values can be used as a weeding tool when considering your financial goals.
Aligning Your Financial Plan with Your Core Values
Each financial goal must serve that ultimate purpose. If it doesn’t, then it may not be worth doing. Aligning your financial plan to your core values may seem daunting and unusual, but it’s an exercise worth doing. Chances are that this process might make your financial plan look a little different from others because your plan will be positioned for your unique core values.
Having a plan that is aimed at achieving your core values, and the financial goals that serve them, may help you better stick to that plan and avoid regret while you are at it.
Uncovering Your Core Values
Now, let’s get to the practical side of this topic: How can you uncover your core values? There is no one magic button, but there are plenty of exercises that one can engage in to begin uncovering what is truly important.
Remember, your core values are not just about your financial goals. They are the guiding principles that shape your life decisions, including your financial strategies.
Creating Your Financial Plan
Once you’ve identified your core values, the next step is to align your financial plan with these values. This might involve re-evaluating your current financial goals and strategies and making necessary adjustments to ensure they serve your core values.
Remember, a financial plan that aligns with your core values is not only more satisfying but also more likely to be successful because it resonates with who you are at your core.
Sticking to Your Value-Aligned Financial Plan
Having a financial plan that reflects your core values can help you stay committed to your financial goals. It can provide you with the motivation and determination needed to stick to your plan, even during challenging times.
Moreover, a value-aligned financial plan can help you avoid regret and ensure that your financial decisions are in harmony with your overall life goals and values.
Creating Financial Harmony
Aligning your financial plan with your core values is not just about achieving financial success. It’s about creating a financial strategy that is in harmony with who you are and what you value most in life. It’s about making financial decisions that not only make sense on paper but also resonate with your core values.
So, take the time to identify your core values and align your financial plan with them. You might be surprised at how this simple step can transform your financial journey and lead you to a more fulfilling and successful financial future.